Why has Brazil kept its interest rates high in the midst of political turmoil?

Question

Quizplus · Accepted Answer

The Answer is Brazil has kept its interest rates high due to uncertainty that a rate adjustment would benefit the country's economy. Brazil is on the brink of "fiscal dominance," an economic scenario in which the country's poor finances have made monetary policy ineffective. Furthermore, Brazil's central bank is dependent upon the government. The institution enjoys a low degree of operational autonomy and there are major fears of government interference from the president of the ruling Workers' party. Analysts suspect that the current president may comply with these calls in exchange for support against Congress's motion for impeachment.

Why Has Brazil Kept Its Interest Rates High in the Midst